Business Mathematics Brief 12th Edition by Stanley Salzman ,Gary Clendenen, Charles Miller

Exercise 155

Find the payment necessary to amortize the following loans using the amortization table. Round to the nearest cent if needed. (See Example.)
Amortizing a Loan
Sven Yarborough earned a degree at a community college and is now a mechanic at a Ford dealership. He was so impressed with the quality of Fords that he purchased an SUV at a cost of $29,400, including tax, title, and license, after the rebate. He made a down payment of $3500 and was able to finance the balance at a rate of 6% per year for 4 years. Find (a) the monthly payment, (b) the portion of the first payment that is interest, (c) the balance due after one payment, (d) the interest owed for the second month, and (e) the balance after the second payment.

SOLUTION